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New amortisation requirement causes division

The Swedish Financial Supervisory Authority, or FSA, said on Monday that all new mortgage holders who borrow more than 4.5 times their gross income must amortise 1 percentage point more of their mortgage per year than is the case at present. It will now be up to the Swedish government to decide what to do.

Opinion is divided, however. Housing Minister Peter Eriksson has openly expressed his doubts but Financial Markets Minister Per Bolund, who is the responsible minister, has warned of the consequences if the proposal is stopped.

The government intends to hold talks with the opposition, but Per Bolund is keen to stress that it will be up to the government rather than parliament to make a decision.

The opposition parties have in principle already said No to the proposal. Elisabeth Svantesson, the Moderate Party spokesperson on economic policy, argues that such a requirement would stop young people from buying a home and could fuel a downturn.